In a better world, we would not need to buy a car. We could get around by hopping on a train. There would be no parking, no stress during the commute, and few accidents. The problem of drunk drivers would not be our problem. Spending money on car insurance, maintenance and gas would become a thing of the past. But we live in a country that has been held back in time by the conservative right-wing for a long time. The right-wing hates mass transit, because it helps the poor and the middle-class. Even talking about mass transit brings up fears concerning "socialism." Worse, mass transit connects non-white areas with white areas, and the racists worry about the exportation of crime from one area to another. For these reasons, mass transit never took off in the U.S. to the extent that it did in other cities around the world. Many of us need to buy a car just to get to work, because there is no mass transit, or the mass transit is inadequate.
The cardinal rule about buying cars is never buy a new one. This should be obvious, yet most of my friends and acquaintances still feel that new cars are the way to go. Upon my asking them why they bought a new one, the usual reasons given are:
1. They don't need all the money up front, but can buy on generous credit terms
2. A new car has no worries about potential mechanical failure
3. A new car looks better and feels better
4. A new car comes with a lengthy warranty
5. A new car has features which old ones do not
I suggest that all five of these advantages pale in comparison to the advantage an old car has of being cheaper. The truth is you can pay one-tenth the price of a new car and still be laughing all the way to the bank. First of all, do not use credit, ever, except when buying a house. Home mortgages enjoy certain tax advantages and other legal advantages, and everyone needs a roof over their head, although there are some that live out in the woods or under a bridge to avoid even that expense, but I'm not going to recommend you go there.
In order to avoid buying a lemon, you need only one thing, knowledge. This is obtained by reading about cars and learning about the differences between them so that you can judge a car based upon its documented advantages, the most important being reliability, rather than mere looks. Appearance means little, although if you are the "dress to impress" type, you should cough up a few thousand dollars extra for a nice paint job.
The best used cars by far will be found from your friends, coworkers, and acquaintances. Spread the word around at parties and at work. You are more likely to get a good deal from someone you know, who will hesitate to take advantage of you because their reputation is on the line. To most people, their reputation is of far more value to them than a couple hundred dollars here or there. They will hesitate to lie to you in any way, because you might then complain to mutual friends. Now car salesmen will talk about how important their reputation is to them, but the reality usually is, you do not mix in their social circles, and they do not mix in yours. Car salesmen cultivate thick skins out of necessity.
If your friends are not in the market to sell a car, you can also find excellent cars that are for sale in the classified ads of your local paper or even on a web site such as Ebay. Try to buy from the original owner rather than a middle man. The original owner does not have to pay taxes on the sale in most states, whereas a car salesman does. Also, the original owner will usually cut you a deal if you can pay in full in cash, because he does not have a financing department, and not many people can pay in cash. Find the market value of a vehicle by referring to Edmunds. Remember, even though you want a cheap ride, the owner does not want to feel like he's being taken for a ride. You should pay fair value--what the market says the car is worth--which is usually very little. Any car over ten years old is likely to be a dirt cheap bargain.
Although you may get lucky with an American car, I have come to the conclusion that buying Japanese is the best plan, despite the fact that American used cars sell at a fraction of the price of Japanese used cars of the same type and year. I used to think that the marketplace was unfair to American cars, but actually the marketplace bends over backwards to assign value to American cars, value that the American cars do not deserve.
Expect to make a few repairs on your used car. Budget a couple thousand for potential repairs. In most cases, you will only wind up paying less than a thousand for repairs. You may be surprised to discover that cars made in the last twenty years have become quite reliable. I bought a fifteen year-old used Toyota Corolla for only $1500 from a friend, and it has been one of the best cars I've ever had, reliable in every way save one--the air conditioning broke. I didn't much care, because all four windows can still be rolled down. Fuel economy? How does 30 miles to the gallon sound? Good? I think so.
For better fuel economy and reliability, I decided to replace all four tires for $200. New tires represent an excellent investment, even more so when gas prices are high. An old tire that leaks air at a higher rate will generate more friction, whereas a fully inflated tire will generate less friction, improving fuel economy. Barack Obama referred to this fact during his presidential candidacy as one way ordinary Americans could reduce their dependence on foreign oil. The Republicans jeered at him, but he was spot-on. If the tires are alright, just inflate them to their recommended capacity. But when acquiring a used car, typically the tires need replacement. Even if the tires don't have obvious bad spots, hidden dry rot in older tires can create a potential for an expensive blow-out. Almost by default, I would recommend replacing the tires on a used car unless they look new or the owner states that they are indeed new tires. I also recommend changing both the oil and the oil filter upon purchasing the car. Every time you change the oil, in fact, you should change the oil filter, because it costs very little but has a strong influence on the quality of your engine's lubrication. You should also check the air filter and replace if it is dirty.
There are few things required to keep a car running these days, beyond the basics of oil, the air filter, and the tires. The rest can be left up to your neighborhood mechanic, preferably an independent shop, because once again you can't really trust the car dealerships, which tend to be thirsty for short-term gain and disinterested in treating customers right. For instance, I took my Nissan to a Nissan dealership and was told that I needed a $600 repair for a leaking valve. I took it to an independent, and he said I needed no such thing, and it turns out that he was right. Independent mechanics grow their business almost solely from word of mouth, and their reputation means a great deal to them. I have found independents to be honest almost to a fault. Remember the air conditioning problem I mentioned earlier in the article? My independent mechanic offered to adjust one of the belts to simply bypass the air conditioner, effectively disabling it, but allowing the car to function, which it was unable to do in the current state (the belt had become paralyzed). What did he charge for this? How about $15! Try to imagine a dealership even offering me the option of bypassing the air conditioner, let alone fixing the problem for under a hundred dollars.
In summary, if you want to save money--and you should--then buy used, buy from a friend, be liberal about replacing those car tires, never forget to change the oil every six months at minimum, and when your car needs work, take it to a reputable independent mechanic, preferably someone that a friend, relative or coworker recommends.
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